Pricing for Profitability

Overview/Description
 Nothing can be more harmful to the success of your new product or service than incorrect pricing and other financial projections! In this course, you will not only learn how to gather pertinent revenue and expense information to help you price your product, but also how to determine your objectives and policies to correctly position your product in its market niche. You'll examine three methods and four strategies used by experts to make pricing determinations. Ultimately, you will learn the company resources that can help you decide whether your project is financially feasible.

Target Audience
 Supervisors, managers, product developers

Expected Duration
2.5 hours

Lesson Objectives:

Understanding Pricing

  • recognize the value of understanding how correct product pricing influences product success.
  • recognize the definition of price as the indication of value.
  • recognize how price influences customer perceptions.
  • identify the relationship of price to brand loyalty.

    • Pricing Influences

  • recognize possible influences on pricing decisions.
  • identify the meaning of market share.
  • recognize that there are two types of competition in the market--price and non-price competition.
  • recognize the definition of the law of supply and demand.

    • Methods and Strategies

  • recognize the value of understanding the relationship between pricing method and pricing strategy.
  • identify the types of businesses and products most likely to use or be priced by the cost-oriented pricing method.
  • recognize the types of businesses and products most likely to use or be priced by the demand-oriented pricing method.
  • recognize the types of businesses and products most likely to use or be priced by the competition-oriented pricing method.
  • match three pricing strategies with reasons for their use.

    • ROI and Financial Support Data

  • recognize the concept of "return on investment" and its importance to project success.
  • select the correct definition of "ROI."
  • identify three major reasons why market share leads to greater return on investment.
  • identify the financial data needed to accurately determine pricing, the break even amount, and establish ROI projections.
  • select the questions that must be asked in making the decision to go ahead with the project.

    • Course Number: STGY0215